Oil Prices Rise as Supply Concerns Outweigh Big Crude Stock Build

Investing.com – Oil prices rose on Thursday as expectations that the Organization of the Petroleum Exporting Countries (OPEC) would start cutting supply overshadowed a big crude stock build last week.

for December delivery traded 0.6% higher to $56.77 per barrel at 1:08 AM ET (05:08 GMT) on the New York Mercantile Exchange, while for January 2019 delivery gained 0.6% to $67.04 a barrel on London’s Intercontinental Exchange.

Despite the rebound of the past two days, WTI remains about 27% lower from four-year highs of nearly $77 hit in early October.

OPEC, which meets on Dec. 6 in Vienna for its policy-setting meeting, is widely expected to agree on cuts of around 1 million bpd or more from its current production of above 33 million bpd.

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“No one’s shorting the market at this point because everyone’s looking at OPEC and at what the Saudis might do if the prices go any lower,” said John Kilduff, a partner at New York energy hedge fund Again Capital.

“The Saudis have the power to rescue this market. They went from announcing a million barrels in cuts initially to 1.4 million barrels over a matter days. There’s the stirrings of a reaction coming and no one wants to be caught on the wrong side.”

U.S. crude stockpiles jumped by nearly 10.3 million barrels last week, compared to the expectation of a build of just 3.2 million barrels.

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